Permit challenge looms over LNG export terminals at Port...

1of6In three separate Christmas Eve filings, the Sierra Club and several other opponents of three LNG export terminals and a related natural gas pipeline planned for development at the Port of Brownsville asked the Federal Energy Regulatory Commission to reconsider the agency's Nov. 21 decision that gave permits to all four projects.Photo: Marie D. De Jesús, Houston Chronicle / Staff photographer

2of6In three separate Christmas Eve filings, the Sierra Club and several other opponents of three LNG export terminals and a related natural gas pipeline planned for development at the Port of Brownsville asked the Federal Energy Regulatory Commission to reconsider the agency's Nov. 21 decision that gave permits to all four projects.Photo: Courtesy Photo / Annova LNG

3of6A rendering shows the proposed Rio Grande LNG export terminal, one of three planned for the Port of Brownsville.Photo: NextDecade / Courtesy Photo

4of6Three companies from Houston are seekign permission from federal regulators to build liquefied natural gas export terminals alogn the Brownsville Ship Channel. Located near the border with Mexico, the proposed sites are within a wildlife corridor for the ocelot, an endangered species of wildcat. There are fewer than 60 ocelots left in Texs, all of which are found within two separate populations in the Rio Grande Valley.Photo: Ken Ellis / Houston Chronicle

5of6Environmental reviews approved the Brownsville export terminals as individual projects but stated that their combined light, noise and habitat fragmentation could harm the recovery of endangered species such as the ocelot, jaguarundi and aplomado falcon. As part of their bids to obtain permits, the three Houston companies overseeing the projects pledged to set aside a thousands of acres of land for wildlife and to use pollution-reducing, noise-reducing and light-reducing measures during construction and operations that would also take endangered species into consideration.Photo: Marie D. De Jesus, MBI / Associated Press

6of6In three separate Christmas Eve filings, the Sierra Club and several other opponents of three LNG export terminals and a related natural gas pipeline planned for development at the Port of Brownsville asked the Federal Energy Regulatory Commission to reconsider the agency's Nov. 21 decision that gave permits to all four projects.Photo: Marie D. De Jesús, Houston Chronicle / Staff photographer

A legal battle is looming over the future of the liquefied natural gas industry in deep South Texas.

In separate Christmas Eve filings, the Sierra Club and several other opponents of three LNG export terminals and a related natural gas pipeline planned for development at the Port of Brownsville asked the Federal Energy Regulatory Commission to reconsider its Nov. 21 decision giving permits to the projects.

Requesting an immediate halt to any construction activities, the Sierra Club and the other opponents argue that FERC commissioners approved Texas LNG, Annova LNG, Rio Grande LNG and the supporting Rio Bravo Pipeline as individual projects but “failed to take a hard look” at the combined impacts they would have on other industries, air pollution, water quality, endangered species, a historic Native American site, neighbors living near the proposed plants and the broader impacts the projects could have on climate change.

Opponents are soliciting online donations for a legal fight, signaling that the rehearing requests are viewed as a procedural step toward filing a federal lawsuit over the permit decisions.

“If our administrative appeal fails, we will take FERC to federal court,” opponents wrote on their fundraising page.

All three Brownsville projects are being developed by Houston companies. Texas LNG is a privately held company, while Annova LNG’s majority owner is Chicago-based Exelon Corp., a publicly traded utility company. Rio Grande LNG, which is the largest of the proposed export terminals, and the Rio Bravo Pipeline are being developed by the publicly traded NextDecade Corp.

Located just a few miles north of the U.S./Mexico border, the terminals would receive natural gas via pipeline from the Permian Basin of West Texas and other shale plays across the U.S. The gas would be supercooled into a liquid form and shipped aboard massive tankers to Asia, Europe and other destinations where natural gas prices are higher.

The Brownsville projects come at a time when horizontal drilling and hydraulic fracturing have created a large surplus of natural gas in the U.S. With liquefied natural gas viewed as a vehicle to sell gas that would otherwise be burned off in an industry practice known as flaring, five companies have opened six LNG export terminals along the Gulf and East Coasts over the past four years.

If they land sufficient supply contracts and receive financing, the Brownsville projects would represent more than $38 billion of private investment, thousands of construction jobs and hundreds of high-paying permanent jobs in one of the poorest regions of the U.S. Officials with Texas LNG and NextDecade could not be reached for comment, but Annova LNG issued a statement defending its project.

“FERC provided a thorough review of Annova LNG’s application over the course of three years and approved it in November 2019,” Annova LNG said. “We are focused on making significant progress toward developing the most sustainable LNG facility in the U.S.”

The Sierra Club was joined in its Port of Brownsville rehearing requests by Defenders of Wildlife, the city of South Padre Island, the city of Port Isabel, the town of Laguna Vista, the Save RGV From LNG coalition and Texas RioGrande Legal Aid, which is working on behalf of the community groups Shrimpers and Fisherman of the RGV and Vecinos Para el Bienestar de la Comunidad Costera, or Neighbors for the Well-Being of the Coastal Community.

Gilberto Hinojosa, a Brownsville attorney who serves as legal counsel for the city of Port Isabel and as chairman of the Texas Democratic Party, was joined by his wife, Cynthia Hinojosa, as landowners filing as opponents in the rehearing request for Rio Grande LNG and the Rio Bravo Pipeline.

Local concerns range from air pollution and LNG tankers introducing invasive aquatic species to the desecration of a Native American burial site.

“Even if FERC had shown that the project would provide benefits to the public, FERC has not provided a rational explanation as to why any such benefits outweigh the environmental and economic harms that will fall upon surrounding communities,” opponents wrote about the pipeline.

Environmental reviews approved the export terminals as individual projects but stated that their combined light, noise and habitat fragmentation could harm the recovery of endangered species such as the ocelot, jaguarundi and aplomado falcon.

As part of their bids to obtain permits, the three Houston companies overseeing the projects pledged to set aside 1,000 acres of land for wildlife and to use pollution-reducing, noise-reducing and light-reducing measures during construction and operations that would take endangered species into consideration.

Two of the projects, Annova LNG and Texas LNG, went one step further by pledging that their plants would get all their electricity from renewable sources such as wind and solar.

“By using electricity from the grid, Texas LNG can minimize air emissions and use renewable sources of energy such as wind and solar to power its facility,” Texas LNG said in a previous statement. “The estimated air emissions from Texas LNG’s facility are well below the National Ambient Air Quality Standards.”

Sergio Chapa covers the oil & gas industry for the Houston Chronicle and writes for Texas Inc., a weekly Monday insert dedicated to covering the most powerful business leaders in Texas. Sergio was born and raised in the Lone Star State and studied journalism at the University of Texas at Austin. He previously worked at the San Antonio Business Journal, KGBT-TV in the Rio Grande Valley and Al Día in Dallas.